On this edition of Doctors Free of Student Loans, I’d like to introduce you to Dr. Tina. She recently paid off $230k in student loans within 4 years of finishing residency! Like me, she is a primary care doc trained in internal medicine. How did she accomplish this major feat? Read on!
Welcome Dr. Tina!
Welcome Dr. Tina! Please introduce yourself.
My specialty is Internal Medicine. I currently work part time in primary care. I am married and am the primary income earner for our family. My husband works for himself as a personal trainer/nutritionist/life coach and does not have student loans.
Do you have kids? Do they have any educational expenses?
I am a fairly new mom to a 6 month old.
Congratulations! You have a beautiful family!
What are your hobbies and your passions other than medicine?
My passions include travel and food. I love traveling to new places and of course, trying the local cuisine. I also enjoy educating myself about finance.
Yay, a fellow finance nerd! Clearly that interest has served you well since you have demolished your student loans at a fast pace while being in a relatively low earning field.
Dr. Tina's Student Loan Story
Tell us a little about your student debt- how much debt and why you decided to pay it off.
I completed residency in 2014 with about $230k in student loans.
I started working full time right out of residency and quickly burned out. My experience in primary care is the typical story of too many unrealistic demands without the appropriate amount of time or support.
I felt trapped by my student loans – I felt like I had no choice but to continue working in this capacity. I grew very anxious and helpless. This went on for a couple of years until I reached a breaking point.
I decided I was going to take back control of my finances and my happiness. I knew that if I could gain financial freedom from my loans, I could afford an actual work life balance.
How She Paid Off Her Student Loans
Excellent! How did you do it?
I found the White Coat Investor and it was literally a game changer.
I refinanced my loans. I started tracking my expenses to learn where most of my money was going.
Not surprisingly, food was one of my biggest expenses. As much as I enjoyed eating out, we made the decision to start cooking more at home.
We also looked at our expenses to see where things could be scaled back. For example, we found a cell phone plan for 5 people and pay only $20 per person per month – we signed up our siblings and parents.
Once I had enough cash for an emergency fund, I began directing all of my net income (after paying for necessary expenses) towards my loans.
To see my student loan balance dwindling every month was very motivating. It kind of became an obsession.
Then one day in February 2018, I finally paid off my loans!
And I cut back my FTE to 0.6.
More About Frugal Living
That’s amazing! Congratulations!! What an awesome testament to the value of frugal living. How did it feel to live so frugally?
During the time I was aggressively paying off my student loans, I didn’t feel like I was living like a pauper.
I found ways to continue traveling without spending a ton of money. I made use of travel credit cards and their bonuses.
And we didn’t eat just rice and beans. With meal planning, it’s possible to make economical and nutritious meals.
I got rid of the “latte factor” – a cup of coffee made at home is $0.40 compared to the $4 at Starbucks. My husband and I are still driving our 2005 and 2008 vehicles we initially paid for in cash.
I also did medical surveys and used that money for some of our discretionary expenses. We had also bought a modest home in 2015 and we did put 20% down.
We had no financial help or inheritance.
Wow, that really is an amazing story. I’m also very heartened by how our stories are so similar. Like you, Dr. James Dahle was very instrumental in me getting on track financially. Without knowing each other, we took the very similar steps to pay off our loans in a hurry. It makes me believe that this stuff really can work for anyone!
You know, I’m really glad you included that you had no outside help. There has been a meme going around that implies everyone that pays off their student loans fast has some sort of help from an outside party to do so. While, there is nothing wrong with having family help, I’m glad you showed us that we can do it ourselves! It’s not rocket science, it is just basic financial common sense!
One question a lot of people struggle with is whether they should invest or pay off debt. How did you handle investing during loan payoff?
I was still contributing about 3% to my 401k. I decided to invest at least that to my retirement because of the time value of money.
Words of Wisdom
What advice would you give yourself during medical school?
During medical school, I took the full amount of loans offered to me. It felt like monopoly money. In retrospect, I should have taken out less. It would have forced me to budget.
What advice would you give yourself during residency?
I would say be more fiscally responsible, take advantage of a Roth account, and take out a LTD (Long Term Disability) policy – you get the best rates the younger you are.
What advice would you give yourself during your first few years as attending?
To become more financially savvy so you can pay off your loans sooner. I am not sure I would have bought a house within a year of completing residency. But it worked out for us anyways as we bought a home in a hot market and gained $100k in equity quickly.
Life After Paying Off Student Loans
So now, just four years after finishing residency, you are done with your student loans. How does it feel?
Paying off my student loans was one of the most amazing feelings.
What are your plans for the extra money in your budget now that your loans are paid off?
With the extra money, I am maxing out my 401k.
I also contribute to a taxable account and a 529 every month.
I will also be maxing out an HSA.
The extra money has allowed me to cut back my FTE and spend more time with my family.
I am always looking for ways to save more money as financial independence is a goal of ours.
I discovered a project available in neighborhoods across the country called the “Buy Nothing Project.” Your local one can be found on Facebook. It’s where your neighbors can post items that they no longer need and ask if anyone would like them for free. You can also post items you are searching for. The project in our neighborhood is very robust and it helps everyone save money and reduces waste. I have been very fortunate to have gained a lot of baby supplies this way!
Thanks for telling us about this awesome resource! I’ll have to find my local one.
Thanks for sharing your story here, Tina! I am sure it will help many others after you. Any parting words?
Even though my student loans are paid off, the way we live our lives has not really changed much.
We were surprised at how much we actually enjoy this lifestyle.
We just direct our resources to what we value the most (travel and experiences).
When you do that, you don’t feel like you are sacrificing anything.
Excellent! I totally agree. Thanks again, Tina!
See you next week, TFP Tribe!
Stay frugal,
Disha
Are you a doctor free of student loans? Did you annihilate your debt in a short amount of time? We would love to feature you. Head over to the “Contact Me” tab and drop us a line!
Have you made up your mind to annihilate your student loans? I put together a FREE E-book to help get you on your way! Get it here: 10 Steps to Annihilate Your Student Loan Debt (And Still Enjoy Life!).
Want more? Check out the rest of the series!
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